The U.S. State Department says the situation in China is troubling, and it has grave concerns about Saudi Arabia.

It's all spelled out in the annual report on worldwide religious freedom released in Washington Monday.

Secretary of State Hillary Clinton unveiled her department's annual report saying religious freedom is not just an American value, but a universal one.

"Religious freedom provides a cornerstone for every healthy society that empowers faith-based service and fosters tolerance and respect among different communities and allows nations that uphold it to become more stable, secure and prosperous," Clinton said.

She and Assistant Secretary of State Michael Posner clarified where the U.S. stands on a controversial Defamation of Religions resolution under consideration at the United Nations.

"It goes, we think, too far in restricting free speech. The notion that a religion can be defamed and that any comments that are negative about that religion can constitute a violation of human rights to us violates the core principle of free speech, which is so central to us in our own system," Posner said.

Posner described this year's annual report on religious freedom as a universal, ecumenical one in the spirit of President Barack Obama's recent speech to the Islamic world in Cairo. He said there's a growing recognition of greater dialogue across faiths, yet a number of nations are still listed as of countries of particular concern.

Among them is Saudi Arabia.

"People are not allowed to openly practice their religion if they are not Muslim. There is a still a religious police that interrupts people in a private setting …and we still have the concerns about text books," Posner said.

Beyond the pale says Posner -- Saudi textbooks sent around the Middle East that include hateful language about Christians and Jews.

And the assistant secretary described the Chinese government's treatment of Tibetan Buddhist religious leaders and Muslim Uyghur clerics as very troubling.

So, what about Christians worshipping in unregistered house churches?

"What we are trying to do is encourage the Chinese government to recognize and allow people of faith, various faiths, to practice and that's also part of the dialogue as far as I'm concerned," Posner said.

President Obama will visit China next month. Will religious freedom be on the agenda?

"I think it will be part of the U.S.-Chinese dialogue for a long time to come," Posner said.

Although Secretary Clinton says religious freedom is a priority in diplomacy - climate change, global security and economic issues are expected to top the president's agenda in Beijing and elsewhere in the days ahead.